Correlation Between Sit Emerging and Simt Large
Can any of the company-specific risk be diversified away by investing in both Sit Emerging and Simt Large at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Sit Emerging and Simt Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sit Emerging Markets and Simt Large Cap, you can compare the effects of market volatilities on Sit Emerging and Simt Large and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Sit Emerging with a short position of Simt Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sit Emerging and Simt Large.
Diversification Opportunities for Sit Emerging and Simt Large
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sit and Simt is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sit Emerging Markets and Simt Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Large Cap and Sit Emerging is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Sit Emerging Markets are associated (or correlated) with Simt Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Large Cap has no effect on the direction of Sit Emerging i.e., Sit Emerging and Simt Large go up and down completely randomly.
Pair Corralation between Sit Emerging and Simt Large
Assuming the 90 days horizon Sit Emerging Markets is expected to under-perform the Simt Large. But the mutual fund apears to be less risky and, when comparing its historical volatility, Sit Emerging Markets is 2.13 times less risky than Simt Large. The mutual fund trades about -0.04 of its potential returns per unit of risk. The Simt Large Cap is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,684 in Simt Large Cap on August 25, 2024 and sell it today you would earn a total of 71.00 from holding Simt Large Cap or generate 4.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sit Emerging Markets vs. Simt Large Cap
Performance |
| Timeline |
| Sit Emerging Markets |
| Simt Large Cap |
Sit Emerging and Simt Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sit Emerging and Simt Large
The main advantage of trading using opposite Sit Emerging and Simt Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sit Emerging position performs unexpectedly, Simt Large can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Simt Large will offset losses from the drop in Simt Large's long position.| Sit Emerging vs. Fidelity Advisor Gold | Sit Emerging vs. Great West Goldman Sachs | Sit Emerging vs. Short Precious Metals | Sit Emerging vs. Gold And Precious |
| Simt Large vs. Simt Mid Cap | Simt Large vs. Saat Tax Managed Aggressive | Simt Large vs. Sit Emerging Markets | Simt Large vs. Simt High Yield |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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